News & Events

Aid scheme for short sea shipping

Date: 17/03/2017

- The Norwegian government seeks to strengthen the competitiveness of sea transport to help meet the goal of transferring freight from road to sea in Norway. In 2017 we have budgeted NOK 82 million for a grant for ship owners in the European Economic Area (EEA) to support projects that lead to modal shift from road to sea and has a social benefit, says Minister of Transport Ketil Solvik-Olsen in a statement.

- The strength of sea transport is to carry large quantities of cargo over long distances in a more climate and environmentally friendly way, compared to other modes of transport. Transport safety can be improved by benefitting from the safety features of sea freight. Therefore, the Norwegian parliament has launched a grant that will contribute to the establishment of new freight services by sea, says Sven Martin Tønnessen, Director of the coastal management department of the Norwegian Coastal Administration (NCA).

- The establishment of new maritime transport services can often be prevented by high start-up costs and low freight volumes initially. NCA will give support to ship owners established in the EEA, with ships that are flagged in an EEA country, for up to three years provided that the new short sea shipping service generates social benefits, is dependent on state support and becomes viable after the support period, explains Tønnessen.

How the aid scheme is set up

The aid will be directed to shipowners who can, based on a detailed business plan concerning a new route or the upgrading of services on an existing one, document that the aid will lead to a modal shift from road to sea, without diverting maritime transport in a way which is contrary to the common interest. The shipowner may cooperate with other partners to create a solid business plan, but the aid will be granted to the shipowner directly

The new short sea shipping service shall exist between a Norwegian ports or a Norwegian port and a port within the EEA. The grant may only be awarded to one project per route with no renewal, extension or repetition of the project in question, unless the new route is complementary to an existing. Grants will be awarded to existing services only in exceptional circumstances. Such applicants must provide the Norwegian authorities with clear evidence that the service in question would cease operation in the absence of financial support by the state.

The aid scheme has been approved the ESA (EFTA Surveillance Authority) to last from 2017 to 2020. 2020 is the last year applicants may receive confirmation of support. Projects may receive aid from the scheme for a maximum of three years.

The society benefits from transfer of freight from road to sea, because the social costs in terms of accidents, noise, traffic jams, air pollution, greenhouse gas emissions and wear and tear on infrastructure are lower for sea transport compared to road transport. The NCA has developed a unique calculation tool for the environmental benefit. In cases where projects competed for the grant, the NCA will rank these according to environmental benefit generated per granted NOK.